Ballot Measure 1?
After more than 250 hours of public testimony, discussion,
and debate in legislative hearings and meetings, the Legislature
chose to reform Alaska’s oil tax structure. Both Democratic and
Republican legislators agreed that Alaska’s oil tax system had
significant flaws that needed to be fixed. The Legislature’s tax
reforms went into effect on January 1, 2014.
A group opposing the new tax law now seeks to repeal oil tax
reform. The repeal measure was approved to be included on
the August 2014 primary ballot as Ballot Measure 1.
On August 19, Alaskans will vote on Ballot Measure 1,
and help determine Alaska’s economic future.

Key changes in the new oil tax structure:

• The Legislature eliminated high tax rates at high oil prices
with the goal of creating an investment climate that makes
Alaska more competitive with other oil-producing states and
countries, and to increase oil production.
• The base tax rate increased to 35%
from an original 25% to protect the
state’s interest at current and lower
oil prices creating a more balanced
and fair system (source: Alaska Dept.
of Revenue).
• Tax reform eliminated the complex
system of tax credits in favor of a
simpler tax structure tied directly to
oil production.

Voting yes on Ballot
Measure 1 would
return Alaska to the
old, flawed tax
structure.
Voting no on Ballot
Measure 1 keeps
the new oil tax
structure in place.

Oil tax reform just went into effect January 1st, 2014. Falling oil
prices and declining production under the old oil tax structure
(ACES) are the primary causes
of the current dip
New oil tax
in state revenues.
structure
There is no â&#x20AC;&#x153;giveaway.â&#x20AC;?
According to an ISER study
by Professor Scott Goldsmith.
Less than 5% of the revenue
shortfall can be attributed to the new tax structure.

All other factors
that contributed
to the $2.1 billion
revenue shortfall.

Source: University of Alaska Anchorage Institute for Social & Economic Research Report, Prof. Scott Goldsmith

––––

Myth:

––––

Oil tax reform
threatens
the
Permanent
Fund
–––-––––––––

fa c t :
Voting Yes on Ballot
Measure 1 will mean
less production and
less money going into
the Permanent Fund.
Voting No on Ballot
Measure 1 will help
grow the
Permanent Fund
through increased
production.

:
The state receives taxes and royalty revenues from the oil industry.
Taxes do not go into the Permanent Fund, but at least 25% of
royalties do. Royalty revenue is determined by production.The
only way to increase royalties is to increase production.
Source: Alaska Dept. of Revenue website, 2014

Under the old oil tax structure, called ACES, oil production
declined by 6% per year on average since 2007. The new oil tax
structure is designed specifically to boost productionâ&#x20AC;&#x201D;every
additional barrel of oil produced means additional money
deposited into the Permanent Fund. Itâ&#x20AC;&#x2122;s simple. Voting Yes on
Measure 1 means less production and less money going to
the Permanent Fund. Voting No on Measure 1 will add to
the Permanent Fund.
Source: Alaska State Constitution section 9.15: 2013 Alaska Permanent Fund Annual Report, pages 22,30

––––

Myth:

fa c t :

––––

At current and projected
Oil tax
oil prices, the state is
forecasting more state
reform
revenue under the new oil tax
threatens structure than it would have
under the old tax structure
n
o
ti
a
c
u
ed
starting in July 2014.
funding
revenue will allow more
–––-–––––––––– More
long-term, sustainable funding of
Source: Dept. of Revenue presentation, Feb. 2014

our schools. Under the new oil
tax structure, state revenue will
increase with more production
and become more predictable at
a wide range of oil prices.

––––

Myth:

Oil tax
reform
caused a
$2 billion
deficit

fa c t :

––––

–––-––––––––––

Falling oil prices, declining
Alaska oil production, and
rising production costs
account for more than
95% of this year’s revenue
shortfall.
Source: Prof. Scott Goldsmith
ISER, University of Alaska Anchorage, May 1, 2014

Based on current oil prices,
state officials predict the new
oil tax structure will generate
higher revenues than the old,
failed tax system.
Source: Dept. of Revenue presentation, Feb. 2014

––––

Myth:

––––
fa

There’s no
guarantee
that oil
companies
will invest

–––-––––––––––

ct :

Companies are increasing their
investment because of oil tax
reform. BP, Repsol, and

ConocoPhillips have
announced significant
new work since oil tax
reform was passed.

The Alaska Department of
Revenue now projects there
will be s10 billion of new
investments in Alaska over
the next decade.
Source: Dept. of Revenue presentation, Feb. 2014

Since the new oil tax structure passed in 2013,
oil companies have announced plans for:

6 new rigs

Source: Tim Bradner,
Alaska Journal of Commerce
January 16, 2014

s10 billion

in new investments

Source:Dept. of Revenue
presentation, Feb. 2014

The new tax law is already working.

––––

Myth:

––––

ACES, the
old oil tax
structure,
gave
Alaska a
“fair share”

–––-––––––––––

fa c t :
The new oil
tax structure
includes a base tax
rate (35%) that
is substantially
higher than the
old base tax rate
(25%).

At Department of Revenue forecasted oil prices, Alaska’s
revenues will be higher under the new oil tax structure next
year than it would be under the old tax structure.
Source: Dept. of Revenue presentation, Feb. 2014

Alaska gets a “fair share” under the new oil tax structure.
Additionally, under the new tax structure, total government
take (federal, state, local taxes/royalties combined) is 61-65%
at s100 per barrel. The new tax structure makes Alaska
competitive with other top-producing states.
The new tax structure makes Alaska competitive
with other top-producing states
Alaska under the old
tax structure (ACES)

Alaska

71-75%

Current government take under the new tax
structure, based on s100 per barrel price

Alaska

61-65%

North Dakota

63%

Texas

60%

Source: PFC Energy Report, April 2013

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Vote no on Ballot Measure 1 on August 19th

You can register to vote and find out more
information about this yearâ&#x20AC;&#x2122;s primary election at
www.elections.alaska.gov
Find out more ways to get involved by emailing us at
info@votenoonone.com